Transitioning to service models can be hard. It's important to understand the risks, even as you look at rewards. In this video, consider what can go wrong with a service srientation and the importance of the "What's in it for Us/What's in it for Them."
- Transforming your organization to a service orientation can be risky. A major risk is in overspending on service without a clear return on the investment. Many professional associations, ranging from the American Medical Association to the Dry Cleaning and Laundry Institute, have such a broad range of members to serve that it's hard to make anyone really happy. For example, they might respond to every call with equal service, whether the caller is a big source of revenue or someone who only uses their free services.
Because a lot of associations have ambitious missions, like to protect and expand the profession, ensuring the health of our field for its practitioners, they don't have clear guidelines about how merits what level of service. Knowing your mission is am important start, but then you need to develop a viable model to achieve that mission. You can't provide programming for all professionals in your field at all levels and in all specialties unless you have a huge budget. In most cases, organizations need to generate revenue to support their activities.
If your focus is to serve anyone who calls without emphasizing revenue, you either need to get a benefactor or shut down. This can happen in for-profit corporations too. Organizations like LinkedIn and SurveyMonkey provide greater levels of service for paying subscribers than for those enjoying a freemium membership. It's important to know what problem you're solving for your customers, but equally important is that they will recognize that value and provide you with value, usually in the form of revenue in return.
Some organizations fool themselves into thinking that their service orientation matters, even when customers just don't care. I was recently talking to a company that prides itself on its service orientation. They told me that they always put the customer first. They had pictures of customers and slogans about customer love all over their walls. They spend a fortune on 24/7 support. But it turns out that 2/3 of their customers choose them on price alone and see their product as a commodity.
So their current investment in service is not resulting in increased revenue. This company should either stop spending on service or figure out what kind of service actually moves the needle. The service you provide can't be a nice to have. It has to do one of two things. Either it's the trigger that gets a prospect to become a customer, or it's the hook that prevents them from looking elsewhere. Make sure you know how service fits in your business model. Don't fool yourself into thinking it's a hook when, in truth, your customers wouldn't change their decision if you changed your approach.
You'll end up losing money and maybe losing your customers too. Another challenge is when leadership officially decides to become service-oriented without giving a clear signal to the troops on the ground. They might give team members too many metrics and confuse them about what's important. Or they might not change the processes that enable service orientation. Service requires investment. Employees might need more time to handle an inquiry from a customer.
An easier return policy for customers might translate into more cost for the company. Service orientation starts with a mindset, but a real investment must follow. The biggest risks in moving to a service orientation are all about the disconnects between investment in service and the resulting payoff. So make sure you balance what's in it for your customers with what's in it for the organization.
- What is a service orientation?
- The metrics of service
- Evaluating service with the Net Promoter Score (NPS)
- Hiring service-oriented employees
- Changing the company culture
- Types of service-oriented selling
- Overcoming the challenges of service orientation